Telecoms sector wiped from MSCI and S&P indexes

Global equity indexes are getting a long-discussed revamp, designed to keep up to speed with changes in tech and communications.

The world’s two biggest index providers S&P and MSCI have announced they will dump the telecoms sector from their vast warehouse of indexes (after a series of M&As telecoms has only three companies left in the US) and smash what’s left of it together with entertainment and media, thus making a new communications sector.

The change is of particular significance to ETFs, which often track sectoral indexes.

The new sector will be split into two sub-sectors. One will be a new widened form of telecoms, essentially, which will include internet and wireless service providers. The other will be a media group which will consist of companies leeched out of the consumer discretionary sector. It will consist of advertisers, broadcasters, publishers and entertainment companies.

The index providers, in a joint press release, said the change was to keep up with the evolving industry. It’s unclear at this stage which companies (and thus ETFs) will be fired and rehired.